What Are Biden’s Economic Plans and Policies?

As the presumptive Democratic presidential candidate in 2020, former U.S. Vice President Joe Biden has presented a plan for combating the COVID pandemic and the recession it’s fueled. He also has put forth policies to overhaul the nation’s embattled health care system. 

Biden’s plan, which often diverges from current policies enacted by President Trump, also targets the global climate crisis, and he’s outlined policies for education, immigration, and housing, as well as taxes, infrastructure, and trade. 

Key Takeaways

As the presumptive Democratic presidential nominee, Joe Biden has prioritized responses to the pandemic, front-line workers’ safety, and recession recovery in his economic proposals.

Biden would make universal health care available to eligible Americans who want it.

Other planned reforms announced by Biden’s campaign include addressing climate change, education, immigration, and infrastructure.

Biden’s plans would likely require tax increases for corporations and individuals, especially those with the highest incomes.

Pandemic Response

Biden’s proposed policy platform aims to restore the economy in the shorter term by protecting workers from the pandemic. He'd use the Defense Production Act to produce more of the personal protective equipment (PPE) that safeguards essential workers.

Biden would require health insurance plans to completely cover COVID-19 testing and vaccines. A prospective Pandemic Testing Board would coordinate the nation’s testing efforts, and a proposed Public Health Jobs Corp would do contact tracing. These are strategies recommended by the Centers for Disease Control and Prevention (CDC) to control the coronavirus.

Many of the actions proposed by Biden need congressional approval before they can be put into action.

Recession Recovery, Jobs Creation

On July 9, 2020, Biden released details of his “Buy American” plan to create 5 million new jobs.The government would spend $400 billion to buy American products and services. An additional $300 billion would go toward research and development, including half for clean energy, aimed at creating jobs and securing U.S. industry leadership.

In addition to enhanced testing, contact tracing, and PPE, Biden would give essential workers a COVID pay boost. He pledges to guarantee paid leave for anyone who gets sick with COVID-19 or stays home to care for family members ill with the virus. This would reduce disease transmission by allowing sick employees to stay home.

Biden would also more than double the federal minimum wage, to $15 an hour. This is meant to spur economic growth by giving workers more to spend, increasing both demand and business revenue. A 2014 Congressional Budget Office (CBO) report said that raising the minimum wage would take 900,000 families out of poverty. At the same time, it would cost 500,000 workers their jobs.

Health Care Reforms

Biden would expand Obamacare subsidies to reach more middle-income families. Under his proposal, no one would pay more than 8.5% of their income for health insurance.

 Biden would offer universal health coverage, like Medicare, to those who want it. 

Having universal health care could create a healthier workforce: Studies show that making preventive care available reduces the need for expensive emergency-room usage. Biden would allow qualified residents of the states that didn’t expand Medicaid to sign up for the universal health plan for free.

Climate Change Measures

Biden would recommit to the Paris climate agreement and support the Green New Deal. He would restore environmental regulations, such as fuel economy standards that support electric vehicles (EV). Biden’s “Clean Energy Revolution” would invest $2 trillion and create 10 million jobs. It would also:

Achieve net-zero emissions by 2050

Spend $40 billion annually on clean energy research 

End subsidies for fossil fuels

Eliminate carbon emissions from power plants by 2035

Upgrade and weatherize buildings, creating 1 million jobs

The Paris Agreement’s 1.5 C goal is only achievable if the world stopped emitting all carbon by 2030. Biden’s plan doesn’t meet that target. 

Education Proposals

Biden would increase federal funding for K-12 education. Specifically, he would triple Title I funding for low-income families to raise teachers' pay. He promises universal pre-kindergarten, and all community health centers would have early childhood development experts. 

To lower the cost of higher education, Biden would make community colleges and public universities free for qualifying students. 

He would spend $8 billion on community college facilities and $50 billion on workforce training. Education is one of the best ways to close the racial wealth gap and boost economic growth. A McKinsey study showed that, if low-income students had had the same educational achievement as their wealthier peers by 1998, in the next decade they would have added $670 billion to the economy.

Immigration Changes

Biden’s proposals would undo most of Trump's immigration policies. The U.S. would no longer separate families at the border. Biden would raise annual refugee admissions to 125,000 from 22,491 in 2018.10 Biden would also provide a road map to citizenship for undocumented immigrants who pay taxes and pass a background check. 

Biden would address the root cause of immigration at the Mexican border. He would provide a $4 billion aid package to Guatemala, El Salvador, and Honduras, which are plagued by narco-trafficking and violence.

Affordable Housing Plans

Biden plans to make available $640 billion over the next 10 years to provide affordable housing. He would target the homeless, the formerly incarcerated, and veterans.12 Subsidized housing allows residents to focus on improving their job skills and education. It provides stability during bouts of unemployment, so children can remain in school. Specifically, he would:

 Establish a $100 billion Affordable Housing Fund to construct and upgrade affordable housing

Expand the Low-Income Housing Tax Credit

Add $10 billion to Community Development Block Grants

Fully fund Section 8 rental assistance and add $5 billion in annual tax credits for low-income renters

Tax Approach

Biden aspires to raise federal revenue by $3.8 trillion over the first 10 years, including through individual tax increases for many. He would do this by imposing a 12.4% Social Security payroll tax for those making more than $400,000 a year. He would repeal the Trump tax cuts for high-income filers, and increase the corporate tax rate to 28%.

Biden would make the tax code more progressive, meaning high-income households pay a larger share of their incomes in taxes than do lower-income taxpayers. Studies show that progressive taxation reduces income inequality by allowing the poor to save more. 

Infrastructure Rebuilding

Biden would rebuild infrastructure, targeting funding to low-income neighborhoods, training programs, and carbon dioxide (C02) reduction. The plan would invest $5 billion over five years to improve battery technology for electric vehicles and add charging stations. Biden’s plan would also expand the nation’s rail system, invest in high-speed rail, and give Amtrak incentives to become fully electric.

Trade

Biden would set a goal of restoring American leadership in strategic areas such as clean energy, artificial intelligence (AI), and quantum computing. To confront China’s trade barriers, Biden would work with U.S. allies to present a united front in trade disputes.